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Sprint to use ItsOn's technology to launch new prepaid service this summer

ItsOn, the cloud-based mobile services provider behind the Sprint (NYSE: S) MVNO Zact Mobile, said it will shut down Zact. However, Sprint will be using ItsOn's technology and platforms to power a new, no-contract service it will launch in the coming months.

ItsOn launched Zact in 2013 to showcase its technology, which allows customers to dynamically adjust their plans on the go, adding or dropping voice minutes, text messages or data as they see fit. Customers can also segment their data service out by application to include things like unlimited email or specific time blocks of access to certain apps.

In June, ItsOn inked a deal with Sprint for the carrier to use its cloud-based OSS/BSS services. ItsOn boasts that it lets carriers virtualize service policy control, billing and traffic-management functions for data, voice and texting services. ItsOn also claims that the service will let operators offer more personalized and contextual services to customers.

ItsOn said it will be giving existing Zact subscribers the choice to keep their Zact device and start service under Sprint's new offer, or to discontinue their Zact service and find a new carrier. As part of the transition, current Zact customers began automatically receiving free service for their existing monthly plans as of July 4. Zact stopped selling new service plans and new devices as of July 4 as well, shortly after current Zact subscribers were notified of the changes.

Zact said it will discontinue service at the end of August. ItsOn doesn't plan to offer refunds to customers who purchased devices through Zact.

ItsOn CEO Greg Raleigh told Re/code that Sprint's forthcoming prepaid service will use the technology to offer customization options that are different than what Zact offered. Sprint plans to launch the new prepaid service sometime later this summer, so the launch could be as late as September.

"Sprint is in a position to do things for users that we can't do," he said. "They know more about what consumers want."

"With ItsOn's technology, Sprint sees an opportunity to give no-contract consumers greater choice and real-time control of their mobile service," Dow Draper, the president of Sprint's prepaid operations, said in a statement. "ItsOn's cloud-based solution enables a unique user experience and could help reduce our timelines for designing and launching distinctly new service offers. These new capabilities provide a very personalized on-device customer experience--both for individuals and families."

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